The 99% Solution

The 99% Solution

The “occupation” campaign has heightened awareness concerning income distribution in developed and emerging economies around the world. Critics of the campaign argue that, with no apparent leadership or clear demands, it is a poorly-conceived ‘grump-fest’. Sympathizers assert that it is a grassroots expression of disapproval of a further income skew that has seen the rich getting richer and the poor getting poorer. In their view, the perceived hyper-wealth of the top 1 percent is in stark contrast to the economic deterioration of those who number themselves among the “we are the 99 percent”.

In The 99% Solution, AIMS Director of Research Don McIver recognizes that “market” incomes in countries like the United States and Canada have certainly been increasingly skewed in favour of high income earners but argues that a more pertinent measure examines the distribution of “disposable” incomes after adjustment for tax progressivity and government transfers.

McIver argues further that even as ‘globalization’ is being socially vilified for its apparent contribution to rising national income disparities, it is substantially narrowing the income spread between countries—so that the same economic forces that stimulate wealth generation in advanced countries also foster a more equitable income share for developing countries.